WSJ: T-Mobile and Sprint have worked out the broad outline of a deal

WSJ: T-Mobile and Sprint have worked out the broad outline of a deal
While T-Mobile and Sprint have yet to announce their oft-rumored merger, this morning's Wall Street Journal says that the broad outline of the deal has been drawn up. With both carrier's canceling the post announcement conference call that is traditionally held after every earnings release, analysts now expect an announcement to either be imminent or further delayed. The WSJ says that both sides have agreed on an all stock transaction, and T-Mobile parent company Deutsche Telekom will be the majority owner of the combined operation.

Charismatic executive John Legere, the president and CEO of T-Mobile, and the architect of the company's amazing recent success story, will run the merged T-Mobile-Sprint. The chairmen of T-Mobile and Sprint's parent companies will be co-chairmen of the board. That would be SoftBank's Masayoshi Son and Deutsche Telekom's Tim Höttges. There will be no cash break up fee. If regulators put the kibosh on the deal, T-Mobile will give Sprint a deal that will allow the wireless operator to use T-Mobile cell towers to cover gaps in the carrier's wireless footprint.

Back in 2014, the FCC and DOJ made negative remarks about a possible combination of the two carriers which led T-Mobile and Sprint to end merger talks. Back then, Sprint would have been the acquirer. T-Mobile has since become the fastest growing and most innovative wireless operator in the U.S. under the leadership of Legere, who has arguably become the face of the industry in the U.S. In 2015, T-Mobile leaped over Sprint to become the third largest carrier in the country. A combined T-Mobile-Sprint would close in on the number of AT&T subscribers and could challenge Verizon for the number one spot in the U.S.

Currently, T-Mobile has a market value of $51 billion, compared to Sprint's market cap of $28 billion.

source: WSJ

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12 Comments

1. libra89

Posts: 2221; Member since: Apr 15, 2016

Wait, so this is really happening?!

2. Soundjudgment

Posts: 370; Member since: Oct 10, 2016

I think we'll see it called, SprinT-Mobile. :)

3. libra89

Posts: 2221; Member since: Apr 15, 2016

Welp. When/if this comes to pass, any other big cellular merges should be blocked. I'm scared for what this means though.

11. TeriusRose

Posts: 108; Member since: May 12, 2017

It means we're in the exact same situation we have with airlines, banks, ISP's, oil & gas, mass media & pharmaceutical companies.

12. audibot

Posts: 590; Member since: Jan 26, 2017

hahaha i called it sprinT-mobile back in 2013 and 2014 because sprint wanted to buy it but now i think it would be just t-mobile or something different all together like att cingular

4. Panzer

Posts: 278; Member since: May 13, 2016

Don't like to see less competetion but this should speed up the death of CDMA. And for those of us who buy international devices and live in boondocks it should mean another option other than ATT.

5. Godfather

Posts: 68; Member since: Oct 31, 2012

Usually the more valuable of the two names will remain the name of the new merged company.

6. palmguy

Posts: 955; Member since: Mar 22, 2011

Like Lord Vader said "NOOOOOOOOOO!!!!"

7. 1phoneman843

Posts: 2; Member since: Oct 25, 2017

I Actually think the merger will be good for the market. With the exception of Sprint, who is still trying to gain and keep customers with lower prices, The prices between the carriers aren’t that far off from each other now. Plus John is a competitive guy and will keep fighting to be the number one carrier. That alone should keep both at&t and verizon honest.

8. cncrim

Posts: 1558; Member since: Aug 15, 2011

What's make you think John will be with Tmobile forever, and what's make you think that he will not screw up competition later?

10. TeriusRose

Posts: 108; Member since: May 12, 2017

That's not really how oligopoly's work. That's how it should theoretically be with airlines, cable/satellite, or banks but they've been raising rates and making up fees for quite some time now. It hasn't resulted in better choices & prices for us. I don't see how less choice can equal more competition.

9. CreeDiddy

Posts: 2118; Member since: Nov 04, 2011

VZ is still going to clean up shop...T-MOBILE needs sprints customer base to compete against ATT and VZ

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